Washington, DC, United States (4E) – Initial claims for unemployment benefits dropped significantly last week to its lowest level in seven years, evidence of strengthening labor market after several weeks of instability.
In the week ended May 10, first-time jobless benefits declined by 24,000 to 297,000 on a seasonally adjusted basis, according to the Labor Department’s report released Thursday. The figure was below estimates as economists polled by The Wall Street Journal called for the new claims to rise slightly to 320,000.
The four-week moving average–a more credible measure of trends in claims as it evens out weekly volatility–declined slightly by 2,000 to 323,250 last week.
In week ended May 3, the volume of continuing unemployment benefits–those drawn by workers for over a week–dropped by 9,000 to 2,667,000, and represents the lowest level since December 2007. The figures are reported with a one-week lag.
Applications for new benefits were impacted by the moving holidays, resulting to distortion in the Labor Department data. This led to surprisingly high figures for recent claims and others particularly low. No special factors were seen in the claims data for last week, according to the Labor Department.